In what it described as a novel issue of law in the Eighth Circuit (the Federal Circuit including Minnesota and North Dakota), the United States Bankruptcy Appellate Panel (BAP) for the Eighth Circuit recently ruled in In re Lewis and Clark Apartments, LP that, in a valuation of the debtor’s low income housing project for purposes of its proposed Plan of Reorganization, the value of the low income housing tax credits (LIHTC) attributable to the project must be included. While this is a result lenders involved in the LIHTC industry may have assumed, it was not settled
In re Creekside Senior Apartments, LP, 2012 Fed App. 0008P (6th Cir. B.A.P. June 29, 2012)
CASE SNAPSHOT
In a case of first impression, the Sixth Circuit BAP held that, for purposes of valuing collateral under section 506(a) of the Bankruptcy Code, the availability of Low-Income Housing Tax Credits must be considered in valuing a creditor’s secured claim.
FACTUAL BACKGROUND
Given the current state of the economy, it should come as no surprise that business related bankruptcy filings increased 41.6 percent and non-business bankruptcies increased 28.4 percent between June 30, 2007, and June 30, 2008, with more than one million Americans filing for bankruptcy during calendar year 2007, according to the Administrative Office of the U.S. Courts.
One of the most significant tax provisions contained in the recently enacted American Recovery and Reinvestment Act of 2009 (“ARRA”) might prove helpful to certain taxpayers looking to restructure their balance sheets.
The remaining credit after the cancelation of its guarantee through an assignment in lieu of payment (dación en pago) in favor of a creditor with a lower-ranking guarantee is an ordinary credit and cannot be subject to a new classification
It has taken 12 months, but new legislative provisions are now in place to deal with the problems for representatives of incapacitated entities arising from Logan J's decision in Deputy Commissioner of Taxation v PM Development Pty Limited [2008] FCA 1,886.
The new provisions go beyond merely addressing the outcome of PM Developments. They also introduce new obligations for representatives of incapacitated entities as well as some concessions and protections.
In re Creekside Senior Apartments, LP, 477 B.R. 40 (6th Cir. B.A.P. 2012) –
In valuing a bank claim secured by a low-income housing project for purposes of a plan of reorganization, should the remaining federal low‑income housing tax credits allocated to the project be taken into consideration? In Creekside the bankruptcy court said yes, and the bankruptcy appellate panel agreed.
Hogan Lovells Publications | 07 April 2020
Introduction of financial measures in support of businesses facing the Covid-19 crisis
Faced with the impact of the Covid-19 health crisis on the local and European economy, the President of the French Republic and the government announced several emergency measures in order to support businesses in difficulty.
Given the current state of the economy, it should come as no surprise that business related bankruptcy filings increased 41.6 percent and non-business bankruptcies increased 28.4 percent between June 30, 2007, and June 30, 2008, with more than one million Americans filing for bankruptcy during calendar year 2007, according to the Administrative Office of the U.S. Courts.